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Chad is the CFO of Boho Chic, Inc. The company currently has an investments portfolio that...

Chad is the CFO of Boho Chic, Inc. The company currently has an investments portfolio that includes a variety of both debt and equity securities. Chad’s bonus is based on whether Boho meets certain earnings projections. How can Chad take advantage of the classification of investment securities to improve his chances of receiving his bonus? Discuss the ethical and legal implications.

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Answer #1

Since Chad is the CFO of boho Inc he is incharge of all financial statements results early then any other investor in the market. So he can buy or share his equity shares in boho Inc if he has any part in his portfolio.

Also Chad's bonus is linked to performance of boho earnings. So Chad might attempt to inflate earnings by accounting manipulations and thus resulting in more chances of getting the bonus.

If he does any of the above act he is going south in ethically and legally moral compass.

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